Does SEM = SEO + CPC Still Add Up?

I’ve found it annoying that over the years, more and more people use SEM to mean paid search, as if SEM excludes SEO. That’s not how I defined SEM — search engine marketing — back 2001. I’d still like to see the original definition retained. But I might be swimming against the tide. Below, how I think we arrived at this conflict and some thoughts on where we go from here.

Types Of Listings

To understand where we’re at now, let me start with some core concepts. There are two basic ways to show up in search results:

Editorial / Organic / Natural Listings: Any good search engine, such as Google or Bing, has “editorial” or “organic” or “natural” listings. These are listings that appear without anyone paying for them. They are provided as a core product of that search engine, in the same way that a newspaper has a core product of writing stories about topics it believes are of interest to its readers, rather than to its advertisers.

Paid Search / CPC / PPC Listings: Search engines also have paid search ads, sometimes referred to as “CPC” or “PPC” listings. Those acronyms come from the way advertisers are charged for these ads, on a Cost-Per-Click or Pay-Per-Click basis. If you pay, you get listed. When you stop paying, your listing goes away. Similar to newspapers, these ads typically appear alongside — but separate from — editorial content. They’re also not supposed to influence the editorial coverage.

Types Of Search Marketing Activities

What do you call the act of obtaining these search listings?

SEO has been the term used for gaining natural listings and also for people or companies who do such work. The letters stands for Search Engine Optimization (and here’s some history on how we got that term). No, SEO is not about spamming the search engines. It’s an acceptable practice that search engines actively encourage. In the search world, SEO is equal to PR in the “real” world. Good SEO can’t guarantee good search engine “coverage,” any more than good PR can guarantee a favorable newspaper article. But it can increase the odds, if done within acceptable boundaries.

SEM: This has been the term I’ve used for gaining both types of listings, and for people or companies who focus on both.

PPC / CPC / Paid Search: How about a term for just getting paid listings? As you can see, there are multiple terms that can be used. Unlike SEO and SEM, none of those terms works to both define the act of getting listings and the people or companies that do it. This awkwardness is why I think SEM has been coopted more and more over the years to cover paid listings.

The Rise & Fall & Rise Of Paid Search

To understand more about how SEM got coopted, you have to understand where SEM came from in the first place. That means a little history lesson about paid listings.

Search engines, as we know them, were largely born in 1994. From the beginning, they had organic listings. But literally years went by before paid listings were a regular option.

In the summer of 1996, paid listings first appeared– then disappeared — for a few weeks. Open Text, one of the leading search engines at that time, allowed people to buy paid search ads that appeared in its search results. This “Preferred Listing” service resulted in a huge backlash, despite the fact that the ads were clearly labeled. The web was still so new, ads and commercialization still so novel, that this seemed too much like selling out to some who were vocal on mailing lists and newsgroups. Open Text quickly dropped the program.

Paid listings came back in a big way with the launch of GoTo, on Feb. 21, 1998. All too often, Google gets the credit for “pioneering” the paid search revolution. That credit primarily belongs to Bill Gross, who founded the search engine – later renamed Overture, then even later acquired by Yahoo. Gross gambled that a model of selling placement would work. He and his team, including CEO Jeffrey Brewer, stuck with the core idea and distributing those listings to all the other major search engines except Google.

My 2000 In Review: AdWords Launches; Yahoo Partners With Google; GoTo Syndicates article covers this more, including how Google launched its own AdWords system. Google’s first paid ad appeared in December 1999, and the company quickly established the AdWords self-serve model the next year. But Google was greatly helped in its success because GoTo’s trailblazing gave it cover for commercializing its own results.

Are SEOs Who Do Paid Search Still SEOs?

As paid listing opportunities grew, some SEOs started doing that work in addition to gaining editorial listings. That caused some to wonder if “search engine optimization” still best described what they were doing. That’s why in 2001, I proposed that “search engine marketing” be used as an umbrella term. As I wrote then:

As the nature of search engine promotion has expanded and matured, the label “search engine optimization” hasn’t seemed to cover what some companies and individuals feel they do. But what should come to replace it, if anything?

The venerable phrase “search engine optimization” originally emerged to cover the optimization that was done for crawler-based search engines. Now directories are a big part of the search engine mix, as are paid listing services. In many cases, you aren’t really “optimizing” for these other venues, but you certainly are doing work that can influence how people are listed.

Personally, my preferred successor term is “search engine marketing” …. I’ve liked the term because I feel it encompasses many things: optimizing for crawlers, managing paid listings, submitting to directories — you name it. All of these activities are marketing on search engines.

2001: SEM, The Umbrella Term

Let me be perfectly clear. I didn’t coin the term “search engine marketing.” I don’t know who did. But I helped popularize it, in part by consciously used it in my writings and when speaking. When the search marketing industry group SEMPO was formed in 2003, I wrote much of the first SEMPO glossary, which at the time described search engine marketing and SEM as:

Search Engine Marketing: The act of marketing a web site via search engines, whether this be improving rank in organic listings, purchasing paid listings or a combination of these and other search engine-related activities.

SEM: Acroymn for search engine marketing and may also be used to refer to a person or company that does search engine marketing (i.e.., “They’re an SEM firm)

SEM: Acronym for “Search Engine Marketing.” A form of internet marketing that seeks to promote websites by increasing their visibility in search engine result pages (SERPs). SEM methods include: search engine optimization (SEO), paid placement, contextual advertising, digital asset optimization, and paid inclusion. When this term is used to describe an individual, it stands for “Search Engine Marketer” or one who performs SEM.

How Did SEM Morph Into Paid Search?

About two or three years ago, I noticed more and more people saying SEM when they meant, to me, paid search. I’d hear people say things like “We do SEO and SEM,” as if SEO wasn’t a part of SEM. I found that grating. I’d usually chalk it up to people either making an innocent mistake or perhaps still being new to the space.

Recently, it’s only gotten worse. I also hear it from people from large companies that I’d say should know better. But this is where I have that “Am I swimming against the tide?” feeling. Maybe it’s me that just hasn’t adjusted. I’ll come back to that, but first, how did this change come about?

Blame Yahoo

My first thought is that Yahoo deserves some of the blame. Remember GoTo, which later became Overture? After Yahoo bought Overture, it incorporated the company into a division called Yahoo Search Marketing. The rebranding happened in March 2005. I can remember a number of search marketers finding the name odd. Since the products were all fee-based — and only for Yahoo — what was so “search marketing” about it?

Over the years, Yahoo has been in front of thousands of advertisers suggesting that “search marketing” = buying ads. In fact, if you search for search marketing on on Google, Yahoo ranks in the top results (as it does on Yahoo, too) despite the fact that YSM has little to do overall with search marketing and, after the Microsoft-Yahoo search deal is fully implemented, won’t even exist in its current form.

All that anchor text — all those people linking to YSM with the words “search marketing” in their links is a powerful legacy, though one that doesn’t work at Bing.

Blame Wikipedia

Next on my hit list is Wikipedia. The community-created encyclopedia has a page on search engine marketing that says:

Search engine marketing, or SEM, is a form of Internet marketing that seeks to promote websites by increasing their visibility in search engine result pages (SERPs) through the use of paid placement, contextual advertising, and paid inclusion.

There’s no mention of SEO in that definition. SEM is made out to be all paid, paid, paid.

I’ve no doubt that many people have turned to Wikipedia to understand what SEM is about, especially since it ranks in the top results at Google for terms like “sem” and “search marketing” and “search engine marketing.” Many of them assume, especially with Google’s effective endorsement of Wikipedia by ranking it so well, that the page must be factually correct.

In reality, a small edit made without supporting documentation transformed an alternative definition of SEM into the current one that Wikipedia promotes. I found this accident so alarming, so indicative of the mess that Wikipedia can make, that I felt it deserved a special detour: How Wikipedia Turned PPC / Paid Search Into SEM.

Still, SEO wasn’t completely excluded at Wikipedia from SEM until the middle of last year, so it can’t take the full blame. Plus, as my other piece explains, it did make sense for Wikipedia to offer an alternative view. It probably contributed to the shift, but it also reflected a change that was happening for other reasons.

Blame Acronyms!

Perhaps the biggest reason behind SEM being transformed by some to exclusively mean paid search is that we often love acronyms. Search engine optimization had a clear acronym: SEO. Paid search suffered by having two unclear ones: PPC and CPC. Which were you supposed to use? And neither was actually specific to search. Pay-per-click and cost-per-click ads happen outside of search listings. Also, unlike with SEO, if you specialized in paid search, you couldn’t call yourself a “PPC” or a “CPC.”

Given this, is it any wonder that those who focused on paid search reached for another term. SEM was already out there. Why not seize that?

That’s what I think happened, more than anything else. Consider this chart:

Those are the number of searches recorded since 2004 on Google for SEM vs. PPC vs. CPC. You can see the rise for SEM really kicks-off in early 2006 while PPC goes into a steady decline. I think that marks when SEM started becoming the preferred term for paid search, for some.

The Growth Of SEM Due To …?

Does the chart prove that SEM has transformed to mean paid search? I don’t know.

Some of the rise might indeed be fueled by people who no longer use the term PPC, as they did in the past. But some of it might be also because of more and more people are seeking information about search engine marketing, the umbrella term, in general.

There’s no way to know for certain. It’s also confusing that when I double-checked on the popularity of SEM using Google’s AdWords Keyword Tool, exact matches (which are what the chart above are also supposed to show), are much lower:

What Should It Be?

In some ways, I feel like I’m back in 2001, when I was watching SEOs struggle with finding the right term to define themselves as they went beyond doing natural listings work. Does it make sense to agree that SEM should now mean work solely on paid listings and also be a name for people and companies that do such work? Especially when plenty of people already talk this way?

I was curious what the market leader in selling such listings was saying: Google. I checked out the transcript from their last earnings call. It’s “search ads” that gets used twice; SEM ads or SEM listings, not at all.

I used to use the term “search ads” myself, though I shifted in the past two years to saying “paid search.” Both those terms have about equal volume according to Google Trends, but neither approaches CPC or PPC.

How about a new acronym? Should we say SEA, for “search engine advertising?” That also work to define a person or a company: search engine advertiser, an SEA.

The advantage to a new acronym is that it would allow SEM to remain an umbrella term for people who do both types of work. Something is needed. There are search engine marketers who don’t want to be miscategorized as only doing paid search, if they do both things.

One of the stupid things in all this is that I rarely write or say “search engine marketing” or “search engine marketer” any more. Long ago, I shortened those to “search marketing” and “search marketer.” The trends certainly reflect that “search marketing” is more popular than “search engine marketing.”

Funny, then, all this confusion over the acronym SEM when we’re really talking about SM these days.